Faces fewer tariff headwinds
April 30,2025
The California walnut industry may be in better shape than its sister nut crops – almonds and pistachios- when it comes to threats from tariffs this year. All three big California nut crops count on exports around the globe to make a profit.That factor alone makes them vulnerable to trade wars. The California walnut industry exports 2/3 of their walnut crop.
For two of three big nut crops, China is a top destination but now saddled with huge double digits tariffs imposed by China responding to the latest Trump tariffs.Not walnuts since we no longer sell into that market.
Arguably, a major threat to pistachio exports comes from China who last year took about 33% of our exports. Also almonds have counted on China as a major destination for shipments but are now in decline.
California exports of almonds to China so far this season is half what it was during the same period in the 2023 crop year – 44 million pounds vs 86 million pounds.As of March 2021 China took 133 million pounds YTD of our almonds.So we are currently shipping about one third the 2021 volume.
As for California walnuts, China in recent years has turned from customer to competitor.China has become a net exporter of walnuts, today producing more than double the tonnage of what we grow.China produces 56% of world tonnage compared to 23% for the US.
So our walnut industry is less affected by the intense 125% trade war with China underway in 2025 since we’ve already retooled to ship product around the world to everyone but China.In 2012 China was a top export market for California walnuts.Now we look elsewhere to sell our nuts.
Top destinations for our walnut exports now are the EU including Germany,Spain, Italy and the Netherlands as well as Turkey, Korea ,Japan and Canada – all less impacted by the trade war so far and with strong and growing middle class customers who love walnuts. Canada is an example of the reduced threat from tariffs in that exports of walnuts are still protected by an existing trade agreement.
Not that China has had no effect on our walnut industry. A big crop in China in 2014 led to lower prices for US walnuts that had big crops of their their own leading to overall lower prices.In 2013 the price per pound averaged $1.88 but fell in 2015 to 83 cents,67 cents in 2018, 60 cents 2020, 29 cents per/ lb in 2022 and 43 cents in 2023, all red ink levels.The reduced demand from China has also impacted the overall US walnut market.Domestically and internationally COVID 19 disrupted supply chains and hurt demand,compounding walnut farmers problems.
Last summer we wrote about this disastrous pricing problem with retired Kings County farm advisor Bob Beede. He didn’t mince words.
“Walnut farmers are getting their a– kicked,” says veteran UC Farm Advisor Bob Beede, as small farmers in both Kings and Tulare counties “are rapidly losing their livelihoods.”
Before retiring, Beede says he spent 35 years helping local growers on 40-to-80-acre plots build their businesses but now they are just “going broke.”
Beede still advocates for these farmers, his friends, who are sometimes forced to let their orchards go unwatered and “turn to firewood or maybe mulch.” To clear the land for another crop requires $2,500 an acre to remove but Central Valley farmers have few choices to replace this once staple nut crop.
The problem is price. Walnut growers have seen the average price for their nut fall from $1.80 a pound 10 years ago to just 30 cents a pound last year and now around $35 cents — well below breaking even.
“These guys need a dollar a pound to stay in business,” argues Beede. Rising costs are happening along with the lowest pricing in decades.”
But today, 9 months later Beede says things have turned around and prices are closer to $1/lb right now.
The latest annual report for the California Walnut Commission tells the story.
“A shift in course for our industry is underway. It began in 2022, when the Boards of Directors took the initiative for change and hired Robert Verloop as our new CEO and Executive Director. Robert is an industry outsider with a long history of success working on behalf of growers. Over his first two years, he and the CWB and CWC staff have been in a crisis response mode – addressing the lingering effects of COVID, the 2022 heat-impacted crop and the industry’s all time largest crop and carry in of 964,000 tons in 2023.”
Today the California walnut crop is smaller but healthier, says Verloop with the likely prospect that the current crop will be 100% sold before the new crop is picked. Instead of a big harvest of 840,000 tons to sell as we had in 2023 the current 24′ crop is about 600,000 tons.
As opposed to going on a planting spree of new acreage as they did for years, walnut farmers are pulling more older trees and planting fewer new ones.
Farmers were urged to remove walnut trees (although not an official tree-pull program) to help right size the crop to meet demand across the world similar to what grape farmers have done at the urging of Allied Grape Growers for the removal of 50,000 acres continuing until demand stabilizes.
That has happened here in Kings County where growers have pulled about 3000 acres of walnuts between 22′ and 24′ – acreage today is about 13,400. This winter,farmers likely pulled more trees that we should see in a May LandIQ report.
The Walnut Commission says 17,987 total acres were removed in the 2024 season. The average age of removed orchards was 26 years old but an equal or even higher number of trees statewide were abandoned bringing the total fewer acres to 36,000 as of September 2024.
As of 2021 California had 445,000 acres of walnut trees both producing and non-bearing and today it stands about 364,000 acres or a loss of about 80,000 acres of trees that turned into firewood.
California walnuts also saw recovery from the drought with Verloop commenting that we’ve had two good snowpack years and better rainfall that have replenished the groundwater and have provided “deep soil benefits”.The industry actually caught a break when an irregular bloom this past year reduced the size of the 24′ crop.
Turning the Corner
Again, the latest annual report from the Commission suggests a brighter future.In a nutshell Verloop says he is “cautiously optimistic”.
“The industry has faced many challenges over the past few years, but there is a sense that we are turning the corner in a positive direction. Walnut trees have recovered from the drought, with winter rains improving the overall health of orchards, thus enabling our growers to produce high-quality crops. Prices rebounded for the 2023 crop with the season ending much stronger than where we started, setting up for improved grower returns versus prior years. But we know return per acre is key, and growers with light crops will continue to struggle, even with the strong prices.
Short-term trade demand will continue to be heavily influenced by global supply dynamics. The California walnut industry will continue to expand distribution in existing markets, when and where favorable pricing exists. New market development partially funded by the USDA Regional Agriculture Promotion Program (RAPP) will help expand the reach of our walnuts and make us less dependent on low-return markets.
As we look forward to the 2024-25 season, current global demand is strong, driven in part by the lighter crops in Chile and the U.S.; at the same time, marketplace dynamics and logistics have returned to pre-COVID conditions. Due to our light crop and low inventories in key markets, we will be able to sell the entire crop and anticipate very low carry-out volumes. This puts the industry in a favorable position for 2024 and 2025 and will provide a more stable supply that buyers can rely on.”